>

f"\ r'l

i 1] j~ B~.:.tl til" it, I~ r~L l..'l. .. llrIL VER SHEE"T'C ,:::: .. ,

q,,,! ~"JI ... , ~J iJ f" ~#l if1 f !'

The JS-44 civil cover sheet and~he~n' ria! . d herein neither replace nor supplement the filing and service of pleadings orotherpapers as required by law, except as provided by local rules of court. This form, approved by the Judicial Conference of the United States in September 1974, is required for use of the Clerk of Court for the purpose of initiating the civil docket sheet.

fEB 08 lOft

PLAINTIFFS CHANEL,INC_

DEFENDANTS

OK PERFUME COLLEcnON 5, INC., d/b/a PERFUME COLLECnON; PERFUME COLLECnON NO. 811tC .. d/b/a PERFUME COLLECTION; PERFUME COLLECnON NO. SINC .. d/b/a PERFUME COLLECnON; PERFUME COLLECnON NO. 10 INC., d/b/a PERFUME COLLECnoN; HAlM YMCOVI; and JOHN OOES '-'0.

ATTORNEYS (FIRM NAME, ADDRESS, AND TELEPHONE NUMBER) Barbara A. Solomon, Esq., Anna P. Leipsic, Esq,

FROSS ZELNICK LEHRMAN & ZISSU, P.C.

866 United Nations Plaza, New York, New York 10017, Telephone: (212) 813-5900

ATTORNEYS (IF KNOWN)

CAUSE OF ACTION (CITE THE U.S. CIVIL STATUTE UNDER WHICH YOU ARE FILING AND WRITE A BRIEF STATEMENT OF CAUSE)

This acUon arises out of Def~R.Pan't.c;>~tPo~1~n Jcl'e~1Fn8 f&1~\?,~~'u,~1#a~~lo7. ~~J'l.b~~rtm~'C~JlJ,n t.ortcl-famous and immediately necognizabte tredemarl<s and fragrance brands, while at the serne time damaging Ch8!lei's image and brand. Specifically, Defendants, who are not and have never been authorized to sell Chanel products, ana in the business of distributing and selling such Iconic Chanel fragnances as COCO MADE~OISELLE, CHANCE EAU FRAICHE and ALLURE HOMME in a manner not authorized by Chane! and that ana materially different from Chanel's authorized fragrance products. By pnasenting Chane!'s branded products in an unauthorized mannie, Defendants not only aea damaging Chane! and causing jmmediata sod irreparable harm to Cbane! but also are deceMng the Qublic.

If yes, was this case Vol,O Invol. 0 Dismissed. No 0 Yes 0 If yes, give date

Has this or a similar case been previously filed in SONY at any time? No? [] Yes? 0 Judge Previously Assigned

& Case No.

(PLACE AN (x] IN ONE BOX ONL Y)

NATURE OF SUIT

FAIR LABOR STANDARDS ACT LABORlMGMT RELATIONS LABORlMGMT REPORTING & DISCLOSURE ACT RAILWAY LABOR ACT [ 1870 TAXES (U.s. Plaintiff or

OTHER LABOR Defendant)

LITIGATION []871 IRS-THIRD PARTY

EMPL RET INC 26 USC 7609

SECURITY ACT

TORTS

CONTRACT

PERSONAL INJURY

FORFEITUREIPENAL TY AGRtCULTURE OTHER FOOD & DRUG

DRUG RELATED SEIZURE OF PROPERTY

21 USC 881 LIQUOR LAWS RR&TRUCK AIRLINE REGS OCCUPATIONAL SAFETY/HEALTH OTHER

PERSONAL INJURY

[ 1110 INSURANCE [ ]310 AIRPLANE [ ]362 PERSONAL tNJURY - [ ]610
[ 1120 MARINE [ 1315 AIRPLANE PRODUCT MED MALPRACTICE [ ]620
1]130 MILLER ACT LIABILITY [ ]365 PERSONAL INJURY
[ 1140 NEGOTIABLE [ ]320 ASSAULT, LIBEL & PRODUCT LIABILITY [ 1625
INSTRUMENT SLANDER [ 1368 ASBESTOS PERSONAL
11150 RECOVERY OF []330 FEDERAL INJURY PRODUCT
OVERPAYMENT & EMPLOYERS' LIABILITY
ENFORCEMENT LIABILITY [ 1630
OF Jt:JDGMENT [ ]340 MARINE PERSONAL PROPERTY [ ]640
[ 1151 MEDICARE ACT [ ]345 MARINE PRODUCT 1]650
[ ]152 RECOVERY OF LIABILITY 11370 OTHER FRAUD [ ]660
DEFAULTED [ ]350 MOTOR VEHICLE [ 1371 TRUTH IN LENDING
STUDENT LOANS (]355 MOTOR VEHICLE [ ]380 OTHER PERSONAL [ 1690
(exCL VETERANS) PRODUCT LIABILITY PROPERTY DAMAGE
[ ]153 RECOVERY OF []380 OTHER PERSONAL [ ]385 PROPERTY DAMAGE
OVERPAYMENT INJURY PRODUCT LIABILITY LABOR
OF VETERAN'S
BENEFITS [ 1710
[ 1160 STOCKHOLDERS
SUITS [ ]720
[ ]190 OTHER
CONTRACT ( ]730
[ ]195 CONTRACT
PROOUCT ACTIONS UNDER STATUTES
LlABlLtTY [ 1740
[ 1196 FRANCHISE CIVIL RIGHTS PRISONER PETITIONS [ 1790 REAL PROPERTY

[ 1210 LAND CONDEMNATION

[ ]220 FORECLOSURE

[ 1230 RENT LEASE & EJECTMENT

I ]240 TORTS TO LAND

[ 1245 TORT PRODUCT LIABILITY

I ]290 ALL OTHER

REAL PROPERTY

[1441 VOTING []442 EMPLOYMENT [ 1443 HOUSING!

ACCOMMODATIONS I ]444 WELFARE

[ 1445 AMERICANS WITH DISABILITIES - EMPLOYMENT

[ 1446 AMERICANS WITH DISABILITIES -OTHER []440 OTHER CIVIL RIGHTS

[ 1510

MOTIONS TO VACATE SENTENCE 28 USC 2255 HABEAS CORPUS DEATH PENALTY MANDAMUS & OTHER [ ]462 CIVIL RIGHTS

PRISON CONDITION [I 483

NATURALIZATION APPLICATtON HABEAS CORPUS· ALIEN DETAINEE OTHER IMMIGRATION ACTIONS

[ )791

tMMIGRATION

[ )530 [ 1535 [ 1540 [ 1550 1]555

[ 1465

ACTIONS UNDER STATUTES

BAHKRUPTCY

[ ) 422 APPEAL

28 USC 158

[ 1423 WITHDRAWAL 28 USC 157

PROPERTY RIGHTS

[ 1 820 COPYRIGHTS [ ]830 PATENT

X ]640 TRADEMARK

SOCIAL SECURI1Y

[ ) 861 HIA (139511)

[ 1862 BLACK LUNG (923)

[ I 863 DIWClDIWW (405(g» I ) 864 SSID TITLE XVI

[ 1865 RSI (405(g»

FEDERAL TAX SUITS

OTHER STATUTES [ 1400 STATE

REAPPORTIONMENT [ ]410 ANTITRUST

[ 1430 BANKS & BANKING [ ]450 COMMERCE

[ ) 460 DEPORTATION

[ ]470 RACKETEER INFLU· ENCED &CORRUPT ORGANIZATION ACT (RICO)

[ ) 460 CONSUMER CREDIT

[ 1490 CABLE/SATELLITE 1V [ 1810 SELECTIVE SERVICE [ 1850 SECURITIESI

COMMODITIESI EXCHANGE

[ 1875 CUSTOMER CHALLENGE

12 USC 3410

[ ) 890 OTHER STATUTORY ACTIONS

[ ]891 AGRICULTURAL ACTS [ 1892 ECONOMIC STABILIZATION ACT

[ )893 ENVIRONMENTAL MATTERS

[ ]894 ENERGY ALLOCATION ACT

[ 1 895 FREEDOM OF INFORMATION ACT

[ ]900 APPEAL OF FEE DETERMINATION UNDER EQUAL ACCESS TO JUSTICE

[ ) 950 CONSTITUTIONALITY OF STATE STATUTES

Check if demanded in complaint:

DO YOU CLAIM THIS CASE IS RELATED TO A CIVIL CASE NOW PENDING IN S.D.N.Y.? IF SO, STATE:

CI CHECK IF THIS IS A CLASS ACTION UNDER F.R.C.P. 23

DEMAND $ undetermineurrHER injunctive

DJUDGE DOCKET NUMBER. _

Check YES only if demanded in complaint JURY DEMAND: 0 YES @ NO

NOTE: Please submit at the time of filing an explanation of why cases are deemed related.

..

(

(PLACE AN x /N ONE BOX ONL Y)

ORIGIN

1Kl1 OrilJioal Proceeding

o 2a. Removed from Siale Courl o 2b.Removed from

03 Remanded from 0 4 Reinstated or

Appellate Court

Reopened

o 5 Transferred from 0 6 Multidislricl

(Specify District) Litigalion

o 7 Appeal to District Judge from Magistrate Judge Judgment

State Court AND

at least one party is pro se.

(PLACE AN X /N ONE BOX ONL Y) BASIS OF JURISDICTION

01 U.S. PLAINTIFF 02 U.S. DEFENDANT IK] 3 FEDERAL QUESTION 04 DIVERSITY (U.S. NOT A PARTY)

IF DIVHRSlTY, INDICATE CITIZENSHIP BILOW. (28 USC 1322.1441)

CITIZENSHIP OF PRINCIPAL PARTIES (FOR DIVERSITY CASES ONLY)

(P lace an [Xl in one box for Plaintiff and one box for Defendant)

PTF DEF

CITIZEN OF THIS STATE I 11 [11

PTF DEF

CITIZEN OR SUBJECT OF A I 13 I ] 3

FOREIGN COUNTRY

PTF DEF

INCORPORATED and PRINCIPAL PLACE 1]5 []5

OF BUSINESS IN ANOTHER STATE

CITIZENOF~NOTHERSTATE 1]21]2

INCORPORATED ~ PRINCIPAL PLACE 1]4 I ]4

OF BUSINESS IN THIS STATE

FOREIGN NATION 1]6 1]6

PLAINTIFF(S) ADDRESS(ES) AND COUNTY(IES) Chanellnc.

9 West 57th Street New York, NY 10019 New York County

DEFENDANT(S) ADDRESS(ES) AND COUNTY(IES)

OK Perfume Collection 5, Inc. d/b/a Perfume Collection

c/o Haim Yaacovi

9409 U.S. Highway 19, NC 20 Port Richey, Florida 34668 Pasco County

Perfume Collection No.8 Inc. Perfume Collection No.9 Inc.

d/bla Perfume Collection d/b/a Perfume Collection

c/o Haim Yaacovi c/o Haim Yaacovi

9409 U.S. Highway 19, NC 20 9409 U.S. Highway 19, NC 20

Port Richey, Florida 34668 Port Richey, Florida 34668

Pasco County Pasco County

Perfume Collection No. d/b/a Perfume Collection c/o Haim Yaacovi

9409 U.S. Highway 19, NC 20 Port Richey, Florida 34668 Pasco County

10 Haim Yaacovi

9409 U.S. Highway 19, NC 20 Port Richey, Florida 34668 Pasco County

DEFENDANT(S) ADDRESS UNKNOWN

REPRESENTATION IS HEREBY MADE THAT, AT THIS TIME, I HAVE BEEN UNABLE, WITH REASONABLE DILIGENCE, TO ASCERTAIN THE RESIDENCE ADDRESSES OF THE FOLLOWING DEFENDANTS:

John Does 1 - 10

Check one: THIS ACTION SHOULD BE ASSIGNED TO: 0 WHITE PLAINS (DO NOT check either box if this a PRISONER PETITION.)

[K] MANHATTAN

RECEIPT #

ADMITTED TO PRACTICE IN THIS DISTRICT [] NO

[X] YES (DATE ADMITTED Mo. _4 __ Yr.~) Attomey Bar Code # bsolomon@fzlz.com

DATE 02/08/11

Magistrate Judge is to be designated by the Clerk of the Court.

J. Michael McMahon, Clerk of Court by

Magistrate Judge ~. is so Designated.

Deputy Clerk, DATED MArfJf1JX;E PffiJAN .

UNITED STATES DISTRICT COURT (NEW YORK SOUTHERN)

Barbara A. Solomon (bsolomon@fzlz.com) Anna P. Leipsic (aleipsic@fzlz.com)

FROSS ZELNICK LEHRMAN & ZISSU, P.C. 866 United Nations Plaza

New York, New York 10017 Tel. (212) 813-5900

Fax (212) 813-5901

Attorneys for Plaintiff Chanel, Inc.

UNITED STATES DISTRICT COURT SOUTHERN DlSTRlCf) ° l:ORK

) ) ) )

) )

)

)

)

)

)

)

)

)

)

)

)

--------------------------------)

CHANEL, INC.,

82

COMPLAINT

Plaintiff,

(Injunctive Relief Sought)

v.

OK PERFUME COLLECTION 5, INC., d/b/a PERFUME COLLECTION; PERFUME COLLECTION NO.8 INC., d/b/a PERFUME COLLECTION; PERFUME COLLECTION NO.9 INC., d/b/a PERFUME COLLECTION; PERFUME COLLECTION NO. 10 INC., d/b/a PERFUME COLLECTION;

HAIM Y AACOVI; and JOHN DOES 1-10,

Defendants.

Plaintiff Chanel, Inc. ("Plaintiff' or "Chanel"), by its attorneys Fross Zelnick Lehrman & Zissu, P.C., for its Complaint against Defendants OK Perfume Collection 5, Inc., Perfume Collection No.8 Inc., Perfume Collection No.9 Inc. and Perfume Collection No. 10:Illc.

\::;:~j)i

(collectively, the "Perfume Collection Defendants"), Haim Yaacovi ("Yaacovi") and John D~

_."

. C.,f" - '

1-10 (the "Doe Defendants") (collectively with the Perfume Collection Defendants anC£;¥aa~i,

. ,. c.:;)

I

"Defendants") alleges as follows: Cli)

[F0738598.2 I

..

SUBSTANCE OF THE ACTION

1. This action arises out of Defendants' actions in creating a business that trades on

and appropriates Chane1's world-famous and immediately recognizable trademarks and fragrance brands, while at the same time damaging Chanel's image and brand. Specifically, Defendants, who are not and have never been authorized to sell Chanel products, are in the business of distributing and selling such iconic Chanel fragrances as COCO MADEMOISELLE, CHANCE EAU FRAICHE and ALLURE HOMME (the "Chanel Fragrances") in a manner not authorized by Chanel and that are materially different from Chane1's authorized fragrance products. By presenting Chane1's branded products in an unauthorized manner, Defendants not only are damaging Chanel and causing immediate and irreparable harm to Chanel but also are deceiving the public.

2. Defendants are displaying, offering for sale and selling the Chanel Fragrances

without Chanel's distinctive outer packaging, without the cellophane wrapping that visually shows consumers that there has been no tampering, without a list of ingredients, without bar codes and with the unique batch codes that are laser-etched into the bottles scratched off - all features and elements that create Chanel's overall genuine product, that are material to a consumer's purchasing decision, and that are part of Chanel' s quality control. Instead, Defendants are displaying and selling the Chanel Fragrances in an unmarked cardboard lining held together by rubber bands or clear adhesive tape which makes Chane1's branded products look shoddy, suspicious and tampered with. The mutilated packaging used by Defendants is likely to lead consumers to suspect that the goods are inferior, stolen, defective, the subject of a recall or are otherwise untrustworthy.

3. Because Defendants are using Chanel's trademarks to sell goods in packaging

other than Chane1's authorized luxury package, Defendants' goods are materially different from genuine product. The sale of such materially different goods under Chanel's marks violates Chanel's rights. Accordingly, Chanel asserts claims for federal trademark infringement under

§ 32(1) of the United States Trademark Act of 1946, as amended (the "Lanham Act"), 15 U.S.C.

(F0738598.2 }

2

§ 1114(1); federal trade dress infringement under 15 U.S.C. § 1125(a); unfair competition and false advertising under § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)(l)(A) and (B); and

substantial and related claims under New York and common law. Plaintiff seeks, inter alia,

injunctive relief; an accounting and award of Defendants' profits flowing from their infringing

activities, which amount should be trebled; statutory damages of up to $2,000,000 per counterfeit mark (or up to at least $16 million in total statutory damages for counterfeiting); prejudgment

interest; attorneys' fees; and any other relief the Court deems just and proper.

PARTIES

4. Plaintiff Chanel, Inc. is a corporation organized and existing under the laws of the

State of New York with a principal place of business at 9 West 57th Street, New York, New

York 10019.

5. Upon information and belief, Defendant OK Perfume Collection 5, Inc. is a

Florida corporation doing business as "Perfume Collection," with its principal place of business

at 8201 South Tamiami Trial, Sarasota, Florida 34238, and also doing business at 303 US-301 Boulevard, Suite 865, Bradenton, Florida 34205

6. Upon information and belief, Defendant Perfume Collection No.8 Inc. is a

Florida corporation doing business as "Perfume Collection," with its principal place of business

at 9409 U.S. Highway 19, NC 20, Port Richey, Florida 34668, and also doing business at 8120 Citrus Park Town Center Mall, Tampa, Florida 33625; at De Soto Square Mall, 303 US-301 Boulevard, Bradenton, Florida 34205; and at Westgate Southfield Shopping Mall, 3501 South Tamiami Trail, Sarasota, FL 34239.

7. Upon information and belief, Defendant Perfume Collection No.9 Inc. is a

Florida corporation doing business as "Perfume Collection," with its principal place of business

at 9409 U.S. Highway 19, NC 20, Port Richey, Florida 34668, and also doing business at 8120 Citrus Park Town Center Mall, Tampa, Florida 33625; at De Soto Square Mall, 303 US-301 Boulevard, Bradenton, Florida 34205; and at Westgate Southfield Shopping Mall, 3501 South Tamiami Trail, Sarasota, FL 34239.

(F0738598.2 )

3

\

8. Upon information and belief, Defendant Perfume Collection No. 10 Inc. is a

Florida corporation doing business as "Perfume Collection," with its principal place of business at 9409 U.S. Highway 19, NC 20, Port Richey, Florida 34668, and also doing business at 8120 Citrus Park Town Center Mall, Tampa, Florida 33625; at De Soto Square Mall, 303 US-301 Boulevard, Bradenton, Florida 34205; and at Westgate Southfield Shopping Mall, 3501 South Tamiami Trail, Sarasota, FL 34239.

9. Upon information and belief, each of the Perfume Collection Defendants is

knowingly engaged in the sale of materially altered fragrance products bearing or incorporating Chanel's trademarks.

10. Upon information and belief, Defendant Haim Yaacovi is the President, sole

officer and sole principal of each of the Perfume Collection Defendants, otherwise controls the acts of the Perfume Collection Defendants including the acts complained of herein, and is directly responsible for or has otherwise orchestrated their unlawful activities. Defendant Yaacovi does business at 9409 U.S. Highway 19, NC 20, Port Richey, Florida 34668.

11. Upon information and belief, the Doe Defendants are individuals or entities who

continuously and systematically conduct and transact business, including the manufacture, importation, distribution, offering for sale, and/or sale of products that unlawfully infringe ChaneI's trademarks and trade dress. Upon learning of the specific identity of said defendants, Chanel shall move to substitute the named parties or to otherwise amend the Complaint.

JURISDICTION AND VENUE

12. This Court has jurisdiction over the subject matter of this action pursuant to § 39

of the Lanham Act, 15 U.S.C. § 1121, and under Sections 1331, 1338(a) and 1338(b) of the Judicial Code, 28 U.S.c. §§ 1331, 1338(a)-(b). The Court has supplemental jurisdiction over the state law claims under Section 1367(a) of the Judicial Code, 28 U.S.C. § 1367(a). This Court also has jurisdiction pursuant to 28 U.S.C. § 1332, as there is diversity between the parties and the matter in controversy, exclusive of interest and cost, exceeds seventy-five thousand dollars.

(F0738598.2 I

4

13. This Court has personal jurisdiction over Defendants because Defendants

distribute and ship into this district the goods that comprise the subject matter of this litigation and transact business in this district, including the unlawful conduct complained of herein. Jurisdiction over the Defendants comports with the Due Process Clause of the United States Constitution and the long-arm statute for the State of New York, Rule 302 of the New York Civil Practice Law and Rules.

14. Upon information and belief, venue is proper in this district pursuant to Section

1391(b) of the Judicial Code, 28 U.S.C. §§ 1391(b), because a substantial part of the events at issue and Defendants' acts of infringement have occurred in this district and Plaintiff is suffering harm in this district.

FACTS COMMON TO ALL CLAIMS FOR RELIEF

A. Plaintiff's Fragrance Business

15. Chanel is a premier manufacturer and seller of a wide variety of luxury goods and

is a recognized leader in the fields of fragrance and beauty. Chane1's fragrances, renowned for their high quality, are sold in its free-standing Chanel boutiques, and are authorized for sale in thousands of retail locations throughout the United States. All of Chane1's fragrance products are sold in packaging that prominently features Plaintiff's iconic CHANEL and CC Monogram trademarks. Hundreds of millions of dollars of beauty and fragrance products have been sold under these marks.

16. Chanel's fragrances, including the fragrances at issue in this dispute, are

renowned for their high quality and are identified and distinguished not only by the use of the CHANEL and CC Monogram marks but also by the fragrance names and packaging which are more fully described below.

17. As a leader in the field of luxury fashion and beauty products, Chanel ensures that

all of its products, including the Chanel Fragrances are marketed and sold in a manner that befits and enhances Chanel' s reputation. It is essential to the marketing of the Chanel Fragrances that all genuine products appear in a uniform fashion and that the products are packaged, displayed

(F0738598.2 I

5

and sold in appealing packaging that enhances the value of the product. Indeed, Chanel goes to great lengths and expense to present the Chane! Fragrances in an appealing manner. The total packaging, from the bottle to the carton are integral to the product and to the buyer's experience of Chanel' s products.

18. Chanel maintains strict quality control over its fragrance products throughout the

entire process, from manufacturing to packaging, from distribution through sale.

19. Many elements of Chanel's overall packaging for all of its fragrance products

ensures quality control. For example, the laser-etched unique batch code that appears on all fragrance bottles is an indicia of authenticity and allows Chanel to determine the origin and distribution of each particular item, and is critical in protecting the marketplace from counterfeit products. Further, the outer box and cellophane wrap assure consumers that the product has not been opened or tampered. The list of ingredients on the outer box further protects and informs Chanel's consumers. The bar code on the outer box assists Chanel in monitoring its inventory, recalling defective products and detecting counterfeits.

20. Having expended so much time and expense perfecting its product and packaging,

Chanel closely oversees the sales process to ensure that customers shopping for Chanel products experience those products the way they are meant to be experienced. Toward that end, Chanel authorizes Chanel-branded fragrance products to be sold only through the company's own boutiques and through authorized retailers. Before a third-party retailer is permitted to sell Chanel products, the retailer is carefully reviewed to ensure that it is capable of delivering a purchasing experience that matches the luxury image of the Chanel brand.

21. Chanel undertakes considerable efforts to build and maintain its image for its

fragrance products. Chanel invests significant time, money and effort to advertise and promote its fragrance products and name, spending millions of dollars a year on such efforts.

[F0738598.2 )

6

B. Chanel's Authorized Fragrance Packaging

1. Chanel's COCO MADEMOISELLE Eau De Parfum Fragrance

22. In 1965, Chanel introduced its COCO line of fragrances, including parfum, eau de parfum and eau de toilette. Since 1965, Chanel has sold tens of millions of dollars worth of COCO branded fragrance products in the United States.

23. Authorized bottles of COCO MADEMOISELLE eau de parfum are presented in a

distinctive outer box that adds to the experience of the fragrance. The outer packaging includes the following elements: (i) a pearlized white colored box with gold trim; (ii) on the front of the box, the words COCO MADEMOISELLE, CHANEL and PARIS in black capital letters and with CHANEL prominently displayed in its iconic font; (iii) on the back of the box, a list of the ingredients in the fragrance and repeated references to CHANEL; (iv) on the back of the box, a unique bar code to allow for tracking and quality control; (v) on the top of the box, the CC Monogram; (vi) on the bottom of the box a legend that the product can be sold only by authorized Chanel retailers. This distinctive outer box is wrapped in cellophane, which protects the box and indicates to consumers that the product has not been tampered with.

24. Inside the outer box is a cardboard liner to further protect the fragrance bottle.

The COCO MADEMOISELLE eau de parfum is sold in a distinctive clear rectangular bottle with the words "COCO MADEMOISELLE CHANEL PARIS" laser-etched and centered inside a gold-edged rectangle on the front of the bottle. The COCO MADEMOISELLE eau de parfum bottle also has a distinctive clear rectangular stopper. A small gold and white band encircles the neck of the bottle and bears the CC Monogram. The COCO MADEMOISELLE eau de parfum bottle also contains a unique batch-code that is laser-etched into the bottle. This unique code allows Chanel to determine the origin and/or product "batch" of the COCO MADEMOISELLE fragrance permitting Chanel to order a product recall or other action in the event a product defect should arise and to protect the market from counterfeit products. Photographs of Chane1's authorized COCO MADEMOISELLE eau de parfum outer packaging and bottle are attached as Exhibit 1.

(F0738598.2 }

7

25. The bottle design used for the COCO MADEMOISELLE eau de parfum

fragrance is extensively advertised and promoted by Plaintiff and its retailers and the media, and is a material aspect of the product as authorized for sale by Chanel.

26. As a result of Chane1's exclusive and extensive use of the COCO

MADEMOISELLE mark and the COCO MADEMOISELLE bottle design as described above, these indicia have acquired enormous value, have become famous among the consuming public and trade, and are recognized as identifying and distinguishing Chanel exclusively and uniquely as the source of products sold under or bearing these marks.

2. Chanel's COCO MADEMOISELLE Eau De Toilette Fragrance

27. In 2001, Plaintiff introduced its COCO MADEMOISELLE line of fragrances, including parfum, eau de parfum and eau de toilette. Since 2001, Chanel has sold tens of millions of dollars worth of COCO MADEMOISELLE fragrance products in the United States.

28. Authorized bottles of COCO MADEMOISELLE eau de toilette are presented in a

distinctive outer box that adds to the experience of the fragrance. The outer packaging includes the following elements: (i) a pearlized white colored box with contrasting gold trim; (ii) on the front of the box, the words COCO MADEMOISELLE, CHANEL and PARIS in black capital letters and with CHANEL prominently displayed in its iconic font; (iii) on the back of the box, a list of the ingredients in the fragrance and repeated references to CHANEL; (iv) on the back of the box, a unique bar code to allow for tracking and quality control; (v) on the top of the box, the CC Monogram; (vi) on the bottom of the box a legend that the product can be sold only by authorized Chanel retailers. This distinctive outer box is wrapped in cellophane, which protects the box and indicates to consumers that the product has not been tampered with.

29. Inside the outer box is a cardboard liner to further protect the fragrance bottle.

The COCO MADEMOISELLE eau de toilette is sold in a distinctive tall, rectangular bottle, with approximately the bottom two-thirds in clear glass and the upper one-third in an opaque white color. The fragrance is sprayed through a hole in the white part of the bottle when the top of the bottle (which is gold in color) is depressed. The words "COCO MADEMOISELLE CHANEL

{F0738598.2 }

8

PARIS" are laser-etched onto the bottle. The COCO MADEMOISELLE eau de toilette bottle contains a unique batch-code that also is laser-etched into the bottle. This unique code allows Chanel to determine the origin and/or product "batch" of the COCO MADEMOISELLE eau de toilette fragrance permitting Chanel to order a product recall or other action in the event a product defect should arise and to protect the market from counterfeit products. Photographs of Chanel's authorized COCO MADEMOISELLE eau de toilette bottle and outer packaging are attached as Exhibit 2.

30. The bottle design used for the COCO MADEMOISELLE eau de toilette fragrance

is extensively advertised and promoted by Plaintiff and its retailers and the media, and is a material aspect of the product as authorized for sale by Chanel.

31. As a result of Chanel's exclusive and extensive use of the COCO

MADEMOISELLE mark and the COCO MADEMOISELLE bottle design as described above, these indicia have acquired enormous value, have become famous among the consuming public and trade, and are recognized as identifying and distinguishing Chanel exclusively and uniquely as the source of products sold under or bearing these marks.

3. Chanel's CHANCE Fragrance

32. In 1995, Chanel introduced the fragrance CHANCE, available as parfum, eau de parfum and eau de toilette. Since 1995, Chanel has sold tens of millions of dollars worth of CHANCE fragrance products in the United States.

33. As a result of the success of the original CHANCE fragrance, in 2007 Chanel

introduced CHANCE EAU FRAICHE, which was designed to complement the original CHANCE fragrance. Since 2007, Chanel has sold tens of millions of dollars worth of CHANCE EAU FRAICHE in the U.S. alone. The packaging for both CHANCE eau de toilette and CHANCE EAU FRAICHE shares the same distinctive features and adds to the experience of the fragrance. The outer packaging includes the following elements: (i) a box with hot pink colored front and back panels and contrasting side and bottom panels and trim; (ii) on the front of the box, the words CHANCE in the contrasting color used on the box with CHANEL in Plaintiff s

{F0738598.2 )

9

iconic font and in black letters below CHANCE; (iii) on the back of the box, a list of the ingredients in the fragrance and repeated references to CHANEL; (iv) on the back of the box, a unique bar code to allow for tracking and quality control; (v) on the top of the box, the CC Monogram; (vi) on the bottom of the box a legend that the product can be sold only by authorized Chanel retailers. This distinctive outer box is wrapped in cellophane, which protects the box and indicates to consumers that the product has not been tampered with. See Exhibit 3.

34. In addition to the outer packaging described above, both the 1.7 and 3.4 ounce

bottles of CHANCE EAU FRAICHE are sold in Chanel gift sets. The gift sets include a foaming shower gel, body cream and the fragrance all packaged together in a signature box designed specifically for these three products. The outer box includes the following elements which combine to make the gift set appealing and which unify the products: (i) a graphic white and black box with distinctive lines to mimic ribbons; (ii) Chanel's iconic camellia flower design on the front center of the presentation box; (iii) the CHANEL mark displayed multiple times on the front of the box; (iv) a list of ingredients in all three products that comprise the gift set; (v) a unique bar code to allow for tracking and quality control; (vi) a legend on the back of the box advising that ''This product may only be sold by authorized Chanel Distributors." The box is covered by clear plastic. Photographs of the outer packaging of the gift set are attached as Exhibit 4.

35. Both the CHANCE eau de toilette and eau fraiche fragrances are sold in a

distinctive (and patented) clear round bottle with a metal band encircling the outside of the bottle and the name CHANCE CHANEL in capital letters centered on the front of the bottle with CHANCE in a metallic print and CHANEL in block print appearing directly below the CHANCE mark. Both CHANCE fragrance bottles have a cube shaped cap covering the spray nozzle. Further, both versions of CHANCE have a unique batch-code that is laser-etched into the bottles. This unique code allows Chanel to determine the origin and/or product "batch" of the fragrance permitting Chanel to order a product recall or other action in the event a product defect should arise and to protect the market from counterfeit products. Photographs of Chanel' s

I F0738598.2 }

10

authorized CHANCE bottles are attached as Exhibit 5.

36. The bottle design used for the CHANCE fragrances is extensively advertised and

promoted by Plaintiff and its retailers and the media, and are a material aspect of the product as authorized for sale by Chanel.

37. As a result of Chanel's exclusive and extensive use of the CHANCE mark and the

CHANCE bottle design as described above, these indicia have acquired enormous value, have become famous among the consuming public and trade, and are recognized as identifying and distinguishing Chanel exclusively and uniquely as the source of products sold under or bearing these marks.

4. Chanel's ALLURE HOMME Eau De Toilette Fragrance

38. In 1996, Plaintiff introduced its ALLURE HOMME line of fragrances for men, including eau de toilette and after shave lotion. Since 1996, Chanel has sold tens of millions of dollars worth of ALLURE HOMME fragrance products in the United States.

39. Authorized bottles of ALLURE HOMME eau de toilette are presented in a

distinctive outer box that adds to the experience of the fragrance. The outer packaging includes the following elements: (i) a brown colored box with gold trim; (ii) on the front of the box, the words ALLURE HOMME in cream and CHANEL prominently displayed in its iconic font and in black lettering; (iii) on the back of the box, a list of the ingredients in the fragrance and references to CHANEL; (iv) on the back of the box, a unique bar code to allow for tracking and quality control; (v) on the top of the box, the CC Monogram; (vi) on the bottom of the box a legend that the product can be sold only by authorized Chanel retailers. This distinctive outer box is wrapped in cellophane, which protects the box and indicates to consumers that the product has not been tampered with.

40. Inside the outer box is a cardboard liner to further protect the fragrance bottle.

The ALLURE HOMME eau de toilette is sold in distinctive clear rectangular bottle with the word ALLURE in brown letters centered on the front near the top. The words HOMME and CHANEL are centered beneath the ALLURE mark in a contrasting color to ALLURE. A round

{F0738598.2 }

11

metallic top with the CC Monogram in brown covers the spray nozzle. The ALLURE HOMME

eau de toilette bottle contains a unique batch-code that is laser-etched into the bottle. This

unique code allows Chanel to determine the origin and/or product "batch" of the ALLURE HOMME fragrance permitting Chanel to order a product recall or other action in the event a product defect should arise and to protect the market from counterfeit products. Photographs of Chanel's authorized ALLURE HOMME eau de toilette outer packaging and bottle are attached as Exhibit 6.

41. The bottle design used for the ALLURE HOMME eau de toilette fragrance is

extensively advertised and promoted by Plaintiff and its retailers and the media, and is a material

aspect of the product as authorized for sale by Chanel.

42. As a result ofChane1's exclusive and extensive use of the ALLURE HOMME

mark and the ALLURE HOMME bottle design as described above, these indicia have acquired

enormous value, have become famous among the consuming public and trade, and are recognized as identifying and distinguishing Chanel exclusively and uniquely as the source of products sold under or bearing these marks.

C. Chane1's Registered Trademarks and Trade Dress

43. Plaintiff owns numerous federal trademark registrations for marks used in

connection with the Chanel Fragrances, (collectively the "Chanel Marks"), including:

MARK REG. NO. REGISTRATION GOODS
DATE
CHANEL 195,360 2124125 Face powder, perfume, eau de
cologne, toilet water, lip stick,
and rouge
CHANEL 510,992* 6114/49 Perfume, eau de toilette, eau de
(Stylized) cologne, face powder, bath
powder, lipsticks
CHANEL 1,348,842* 7/16/85 Full line of perfumery,
cosmetics and toiletries
CC 1,347,094* 7/9/85 Full line of perfumery,
cosmetics and toiletries [FU738598.2 }

12

CC Face powder, perfume, eau de
195,359* 2/24/25 cologne, toilette water, lipstick
and rouge
COCO 848,755* Perfume
517168
COCO 1,464,184* Body creme and eau de
11/10/87 perfume
COCO 1,612,557* Parfum, eau de toilette, bath
9/11190 gel, powder, body lotion and
bath soap
COCO 2,557,185* Perfumery and cosmetics
MADEMOISELLE 4/2/02 products, namely eau de
parfum and skin moisturizers
CHANCE 2,003,332* Perfume, eau de parfum, eau
9/24/96 de toilette, body lotion, body
cream and shower gel
CHANCE 2,767,311 * 9/23/03 Perfumery and cosmetics
products, namely eau de
toilette and skin moisturizers
ALLURE 2,025,798* 12/24/96 Perfume (parfum), eau de
toilette, body lotion, and
moisturizer
ALLURE HOMME 2,370,933* 7/25/00 Fragrance and toiletries,
namely eau de toilette, after
shave, skin moisturizer,
personal deodorant, and
shower gel for cleaning hair
and body
DESIGN MARK 2,382,784* 9/5/00 Perfume, eau de parfum
(BOTTLE DESIGN)
DESIGN MARK 1,687,481 * 5119/92 Perfume, eau de parfum
(STOPPER DESIGN) All of the registrations listed are valid, SUbsisting, and in full force and effect. In addition, those marked with an asterisk are incontestable pursuant to Section 15 of the Lanham Act, 15 U.S.C.

§ 1065, and serve as conclusive evidence of Plaintiff's ownership of those marks and of its

exclusive right to use those marks in commerce on or in connection with all of the goods

identified in the registrations, as provided by Section 33(b) of the Lanham Act, 15 U.S.C. § 1115(b). Printouts from the official database of the United States Patent and Trademark

Office showing status and title of the listed registrations are attached as Exhibit 7.

I F0738598.2 I

13

44. In addition to Chanel' s registered trademarks in the bottle design and stopper

design used for the COCO MADEMOISELLE eau de parfum (collectively, the "Chanel Registered Trade Dress") Chanel owns common law rights in the trade dress it uses for its fragrance bottles described above. The distinctive trade dress used for each of the Chane I Fragrances distinguishes the goods, have become famous among the consuming public and trade, and are recognized as identifying and distinguishing Chanel exclusively and uniquely as the source of products sold in such packaging. The trade dress in the bottles for the COCO MADEMOISELLE, CHANCE and ALLURE HOMME fragrances are collectively referred to herein as the "Chanel Trade Dress."

45. Due to the worldwide public acceptance, overwhelming fame and great

recognition of products bearing or sold under each of the different Chanel Marks and Chanel Trade Dress, each of the Chanel Marks and Chanel Trade Dress has come to represent an enormous goodwill of Plaintiff and has caused merchandise bearing the marks, even unauthorized goods, to be in great demand. The Chanel Marks and Chanel Trade Dress are vital to Chanel and represent not only Chane1's products but Chane1's reputation. Chanel will suffer irreparable harm if any third parties, including Defendants herein, are allowed to trade off Chane1's reputation and goodwill by selling unauthorized goods bearing the Chanel Marks or Chanel Trade Dress that are materially different from genuine Chanel products.

E. Defendants' Unlawful Conduct

46. Plaintiff is informed and believes and on that basis alleges that the Defendants are

actively and knowingly engaged in the distribution, promotion and sale of unauthorized and materially altered versions of the Chanel Fragrances bearing Chanel's world-famous and immediately recognizable Chanel Marks and Chanel Trade Dress. In doing so, Defendants are usurping the Chanel Marks and Chanel Trade Dress for their own benefit.

47. Upon information and belief, Defendant Yaacovi is in the business of selling and

distributing fragrance products, including altered and materially different versions of Chanel' s

(F073S598.2 )

14

fragrance products, through his companies the Perfume Collection Defendants doing business as "Perfume Collection."

48. The Perfume Collection Defendants are retail distributors of fragrance products,

including altered and materially different versions of Chanel' s fragrance products.

49. Defendants are not and have never been authorized manufacturers, distributors or

retailers of any Chanel fragrance product, and are not authorized to use any of the Chane1 Marks or Chanel Trade Dress.

50. Defendants sell and ship such products nationwide, including to this district.

51. Without Chanel' s permission or authorization, Defendants distribute, advertise, offer for sale, and/or sell fragrances that they promote as being genuine Chanel Fragrances and that bear or are sold under the Chanel Marks and Chanel Trade Dress, but that are materially different from the genuine or authorized Chanel Fragrance.

52. Defendants have sold and are offering for sale Chane1's COCO

MADEMOISELLE eau de parfum fragrance. A photograph of such product purchased from Defendants' store at Citrus Park Town Center, Tampa, Florida and shipped to this district is attached as Exhibit 8. This product, known as a luxury product in its authorized form, is being sold in a dilapidated cardboard liner held together with scotch tape. The distinctive outer packaging is missing and with it the list of ingredients, bar codes and protective cellophane wrapper. The overall image created by the product as sold by Defendants is one of a damaged or recalled product or a product that would be considered a "second." The laser-etched unique batch code has been scratched off from the back of the bottle thereby marring or defacing the same. See Exhibit 9. The entire manner in which the product is being displayed and sold is not authorized by Chanel.

53. Defendants have sold and are offering for sale Chane1's COCO

MADEMOISELLE eau de toilette fragrance. A photograph of such product purchased from Defendants' store in the Sarasota Square Mall in Sarasota, Florida and shipped to this district is attached as Exhibit 10. This product, known as a luxury product in its authorized form, is being

[F0738598.2 )

15

sold in a cardboard liner held together with scotch tape. The distinctive outer packaging is missing and with it the list of ingredients, bar codes and protective cellophane wrapper. The overall image created by the product as sold by Defendants is one of a damaged or recalled product or a product that would be considered a "second." The laser-etched unique batch code has been scratched off from the back of the bottle thereby marring or defacing the same. See Exhibit 11. The entire manner in which the product is being displayed and sold is not authorized by Chanel.

54. Defendants have sold and are offering for sale Chanel's CHANCE EAU

FRAICHE fragrance. A photograph of such product purchased from Defendants' store at the Sarasota Square Mall in Sarasota, Florida and shipped to this district is attached as Exhibit 12. Defendants are selling this product without any of Chane1's outer packaging thereby providing no information as to the ingredients or bar code or otherwise providing any protective wrapping for the product. The entire manner in which the product is being displayed and sold is not authorized by Chanel.

55. Defendants have sold and are offering for sale Chane1's ALLURE HOMME

fragrance. A photograph of such product shipped from Defendants' store in Bradenton, Florida to this district is attached as Exhibit 13. This product, known as a luxury product in its authorized form, is being sold in a dilapidated cardboard liner held together with scotch tape. The distinctive outer packaging is missing and with it the list of ingredients, bar codes and protective cellophane wrapper. The overall image created by the product as sold by Defendants is one of a damaged or recalled product or a product that would be considered a "second." The laser-etched unique batch code has been scratched off from the back of the bottle thereby marring or defacing the same. See Exhibit 14. The entire manner in which the product is being displayed and sold is not authorized by Chanel.

56. Chanel does not know where Defendants acquired the goods being sold and

Defendants have gone to great lengths to hide this information by removing all external packaging and scratching off the manufacturer's code.

{F0738598.2 }

16

57. The effect of Defendants' conduct is to degrade the appearance of Chanel's

fragrances, to damage Chanel' s reputation for providing luxury products, to remove information necessary for Chanel to determine the origin of the goods, to hinder Chanel' s quality control efforts and to prevent consumers from access to basic information. Further, the removal of production codes significantly interferes with Chanel's quality control programs by hindering Chanel's ability to determine the origin of its products, identify fakes, resolve quality issues and recall defective products. The removal of the production code which results in defacing bottles bearing the Chanel Marks or incorporating the Chanel Trade Dress, the use of damaged cardboard packaging, the failure to use any external packaging at all, and the sale of products intended to be sold by authorized Chanel retailers by Defendants who are not and have never been authorized to sell any Chanel products, is each in and of itself a material difference from genuine Chanel Fragrances and therefore create infringing products under U.S. trademark law.

58. Upon information and belief, Defendants' actions have damaged and will

continue to damage the prestige of the Chanel brand in the minds of consumers. Purchasers or prospective purchasers viewing Defendant's unlicensed, unauthorized and materially different versions of the Chanel Fragrances and perceiving a defect, lack of quality or any other impropriety caused by the degraded and mutilated package are likely to mistakenly attribute these issues to Chanel and to believe that Chanel has authorized the disposition of such products to the public. By causing such a likelihood of confusion, mistake and deception, the Defendants are inflicting irreparable harm to Chanel's goodwill.

59. Upon information and belief, Defendants' sale or offering for sale of materially

different and altered versions of the Chanel Fragrances has been and is with knowledge of Plaintiff's rights and with the deliberate intent to ride on the fame and goodwill of the Chanel Marks and Chanel Trade Dress and to pass off their unauthorized, non-genuine goods as genuine and authorized Chanel goods.

60. Defendants use the Chanel Mark, Chanel Trade Dress and depictions of Chanel's

fragrance products to advertise and promote their business as shown on Defendants' business

(F0738598.2 )

17

card attached as Exhibit 15. Defendants' use of the Chanel Marks, Chanel Trade Dress and

Chanel's fragrance products on their business cards is an attempt to trade on Chanel's reputation

and goodwill; to falsely suggest that Defendants are authorized retailers of Chanel products; and/or to falsely suggest that the goods offered by Defendants are genuine and authorized products.

61. Defendants' conduct is intentionally fraudulent, malicious, willful and wanton.

62. Defendants' unlawful actions described above commenced many years after

Chanel began using the Chanel Marks and Chanel Trade Dress, many years after the Chanel Marks and Chanel Trade Dress had achieved worldwide fame, and many years after the Chanel Marks and Chanel Registered Trade Dress were registered in the United States Patent and Trademark Office.

63. Defendants' unauthorized acts as described herein have caused and will continue

to cause irreparable harm to ChaneI's business and goodwill and will harm and continue to harm

the public unless permanently restrained by this Court. Chanel has no adequate remedy at law.

FIRST CLAIM FOR RELIEF AGAINST ALL DEFENDANTS:

FEDERAL TRADEMARK INFRINGEMENT OF THE CHANEL MARKS IN VIOLATION OF 15 U.S.c. § 1114(1)

64. Chanel repeats and realleges paragraphs 1 through 63 above as if fully set forth

herein.

65. By selling and distributing the Chanel Fragrances products under the Chanel

Marks without the distinctive Chanel outer box, without the list of ingredients, without bar

codes, with the laser-etched batch codes scratched off from the fragrance bottles, and without the protective cellophane wrapper, Defendants are engaged in the sale of products that materially

differ from the COCO MADEMOISELLE, CHANCE EAU FRAICHE and ALLURE HOMME

fragrance products authorized for sale in the U.S. by Chanel.

66. The sale of materially different Chanel products by Defendants deprives Chanel

of the ability to ensure the luxury quality of products bearing the Chanel Marks, to maintain the

[F0738598.2 }

18

prestige associated with the Chanel name, and to ensure the consistently high quality of products

bearing the Chanel Marks.

67. Defendants' unauthorized sale of materially different Chanel products bearing the

Chanel Marks is likely to cause consumers to mistakenly believe that the sale of such products

has been approved by Chanel. Consumers are likely to be misled into believing that Defendants are authorized dealers of Chanel's products, or that Defendants' products as sold are approved by

or are genuine products of Chanel.

68. Defendants' use of Chane1's registered trademarks in connection with the sale of

materially different products not authorized by Chanel constitutes trademark infringement of

each of Chane1's CHANEL, COCO, COCO MADEMOISELLE, CHANCE, ALLURE,

ALLURE HOMME, CC Monogram and Bottle Stopper marks in violation of Section 32(1) of the Lanham Act, 15 U.S.C. § 1114(1). Further, the use of the registered Chanel Marks by

Defendants for goods not authorized by Chanel and that are not considered genuine goods due to

the material differences between said goods and Chanel's authorized goods constitutes the use of

a counterfeit mark.

69. Defendants' infringement of the federally registered Chanel Marks is willful and

deliberate and undertaken with an intent to reap the benefit of the goodwill of Chanel and of its federally registered marks and the goodwill and reputation associated with these marks.

70. The aforesaid conduct of Defendants is causing immediate and irreparable injury

to Chanel and to its goodwill and reputation, and will continue to damage Chanel and deceive and harm the public unless enjoined by this Court. Chane! has no adequate remedy at law.

SECOND CLAIM FOR RELIEF AGAINST ALL DEFENDANTS:

FEDERAL TRADE DRESS INFRINGEMENT OF CHANEL TRADE DRESS IN VIOLATION OF 15 U.S.c. § 1125(a)

71. Chanel repeats and realleges paragraphs 1 through 70 as if fully set forth herein.

72. The Chanel Trade Dress is non-functional and is identified and associated in the

public'S mind exclusively with Chanel. Further, the Chanel Trade Dress is inherently distinctive.

{F0738598.2 }

19

The Chanel Bottle Trade Dress is famous, highly distinctive of Chanel and is entitled to the broadest scope of protection.

73. By selling and distributing the Chanel Fragrances in the Chanel Trade Dress

without the distinctive Chanel outer box, without the list of ingredients, without bar codes, with the laser-etched batch codes scratched off from the fragrance bottles, and without the protective cellophane wrapper, Defendants are engaged in the sale of products that materially differ from the COCO MADEMOISELLE, CHANCE EAU FRAICHE and ALLURE HOMME fragrance products authorized for sale in the U.S. by Chanel.

74. The sale of materially different Chanel products by Defendants deprives Chanel

of the ability to ensure the luxury quality of products bearing the Chanel Trade Dress, to maintain the prestige associated with the Chanel name, and to ensure the consistently high quality of products bearing the Chanel Trade Dress.

75. Defendants' unauthorized sale of materially different Chanel products bearing the

Chanel Trade Dress is likely to cause consumers to mistakenly believe that the sale of such products has been approved by Chanel. Consumers are likely to be misled into believing that Defendants are authorized dealers of Chanel' s products, or that Defendants' products as sold are approved by or are genuine products of Chanel.

76. Upon information and belief, Defendants were on actual and constructive notice

ofChanel's exclusive rights in the Chanel Trade Dress before using the Chanel Trade Dress to sell materially different fragrance products. Defendants' use of such trade dress is willful and in bad faith and was done with full knowledge of the goodwill and reputation associated with the Chanel Trade Dress. Defendants' acts are willful and deliberate and intended to reap the benefit of the goodwill that Chanel has created in the Chanel Trade Dress.

77. Defendants' conduct constitute trade dress infringement under Section 43 of the

Lanham Act, 15 U.S.C. § 1125(a).

78. The aforesaid conduct of Defendants is causing immediate and irreparable injury

to Chanel and to its goodwill and reputation, and will continue to damage Chanel and deceive

(F0738598.2 )

20

and harm the public unless enjoined by this Court. Chanel has no adequate remedy at law.

THIRD CLAIM FOR RELIEF AGAINST ALL DEFENDANTS:

FEDERAL UNFAIR COMPETITION AND FALSE ADVERTISING IN VIOLATION OF 15 U.S.C. § 1 125(a)(l)(A), (B)

79. Chanel repeats and realleges paragraphs 1 through 78 as if fully set forth herein.

80. By selling and distributing the Chanel Fragrances under the Chanel Marks and

Chanel Trade Dress without the distinctive Chanel outer box, without the list of ingredients, without bar codes, with the laser-etched batch codes scratched off from the fragrance bottles, and without the protective cellophane wrapper, Defendants are engaged in the sale of products that

materially differ from the COCO MADEMOISELLE, CHANCE EAU FRAICHE and ALLURE

HOMME fragrance products authorized for sale in the U.S. by Chanel.

81. The sale of materially different Chanel products by Defendants deprives Chanel

of the ability to ensure the luxury quality of products bearing the Chanel Marks and Chanel

Trade Dress, to maintain the prestige associated with the Chanel name, and to ensure the

consistently high quality of products bearing the Chanel Marks, and Chanel Trade Dress.

82. Defendants' unauthorized sale of materially different Chanel products under the

Chanel Marks and Chanel Trade Dress constitutes a false designation of origin and false

description or representation that Defendants' products are authorized by Chanel and as such is likely to confuse consumers.

83. In addition, Defendants' depictions of Chanel fragrances on business cards is

intended to falsely suggest to consumers that Defendants are authorized retailers of Chanel' s fragrances and that the products they are selling, including the materially altered versions of the Chanel Fragrances, are authorized for sale by Chanel. Through the use of Chanel' s marks and product depictions on their marketing materials, Defendants, in their commercial advertising or

promotion are misrepresenting the nature, characteristics, and qualities of their commercial activities and their goods by falsely creating an association with or causing consumers to believe

that there is an authorized relationship between Defendants and Chanel.

(F0738598.2 )

21

84. Defendants' conduct is willful and deliberate and undertaken with the intent to

reap the benefit of the goodwill and reputation associated with the Chanel Marks and Chanel

Trade Dress.

85. Defendants' conduct described herein violates Sections 43(a)(l)(A) and

43(a)(l)(B) of the Lanham Act, 15 U.S.C. § 1125(a)(l)(A), § 1125 (a)(l)(B).

86. The aforesaid conduct of Defendants is causing immediate and irreparable injury

to Chanel and to its goodwill and reputation, and will continue to damage Chanel and deceive and harm the public unless enjoined by this Court. Chanel has no adequate remedy at law.

FOURTH CLAIM FOR RELIEF AGAINST ALL DEFENDANTS:

FALSE ADVERTISING IN VIOLATION OF N.Y. GEN. BUS. LAW § 350

87. Chanel repeats and realleges paragraphs 1 through 86 as if fully set forth herein.

88. As set out above, Defendants have engaged in advertising that is misleading in a

material respect. As such, Defendants' actions constitute false advertising in violation of Section

350 of the New York General Business Law.

89. Defendants engaged in false advertising in order to induce consumers to purchase

unauthorized Chanel fragrance products from Defendants.

90. Defendants' conduct described herein is causing immediate and irreparable injury

to Chanel and to its goodwill and reputation, and will continue to damage Chane I and harm the public unless enjoined by this Court. Chanel has no adequate remedy at law.

FIFTH CLAIM FOR RELIEF AGAINST ALL DEFENDANTS:

UNFAIR COMPETITION IN VIOLATION OF THE COMMON LAW OF NEW YORK

91. Chanel repeats and realleges Paragraphs 1 through 90 as if fully set forth herein.

92. By selling and distributing the Chanel Fragrances under the Chanel Marks and

Chanel Trade Dress is a manner that is materially different from genuine Chanel fragrances authorized for sale in the U.S., Defendants are engaged in the sale of infringing and counterfeit

goods.

{F0738598.2 I

22

93. Defendants' sale of materially different Chanel products under the Chanel Marks

and Chanel Trade Dress constitutes a false designation of origin and false description or representation that Defendants' sale of such products is authorized by Chanel.

94. Defendants' acts of unfair competition are willful and deliberate and undertaken

with the intent to reap the benefit of the goodwill and reputation associated with the Chanel Marks and Chanel Trade Dress.

95. Defendants' actions described herein constitute unfair competition under the

common law of the State of New York.

96. The aforesaid conduct of Defendants is causing immediate and irreparable injury

to Chanel and to its goodwill and reputation, and will continue to damage Chanel and deceive

and harm the public unless enjoined by this Court. Chanel has no adequate remedy at law.

SIXTH CLAIM FOR RELIEF AGAINST ALL DEFENDANTS:

DECEPTIVE TRADE PRACTICES IN VIOLATION OFN.Y. GEN. BUS. LAW § 349

97. Chanel repeats and realleges paragraphs 1 through 96 as if fully set forth herein.

98. By reason of the acts set forth above, Defendants have been and are engaged in

deceptive acts or practices in the conduct of a business, trade or commerce, in violation of

Section 349 of the New York General Business Law.

99. Upon information and belief, Defendants' conduct is willful.

100. Upon information and belief, by reason of the deception caused by the acts set forth above, the public has been and is being damaged.

101. Defendants' conduct described herein is causing immediate and irreparable injury

to Chanel and to its goodwill and reputation, and will continue to damage Chanel and harm the public unless enjoined by this Court. Chane I has no adequate remedy at law.

WHEREFORE, Plaintiff respectfully demands judgment as follows:

1) That a permanent injunction be issued enjoining Defendants individually and

collectively, and any of their agents, officers, representatives, directors, privies, licensees,

(F0738598.2 )

23

attorneys, servants, employees, affiliates, successors and assigns, all those persons in concert or participation with any of them, and any entity owned or controlled in whole or in part by any of the Defendants, from:

(a) using any of Chane1's trademarks or trade dress, including but not limited to those identified in the Complaint, or any simulation, reproduction, copy, colorable imitation or confusingly similar variation of any of Chanel's trademarks, or trade dress on or in connection with any advertisement, promotion, offering for sale, sale, or distribution of Chane1-branded products, unless such use is in connection with genuine Chanel goods of the nature, type and in the form authorized by Chanel for sale in the U.S.;

(b) using any of Chanel' s trademarks or trade dress, including but not limited to those identified in the Complaint, or any simulation, reproduction, copy, colorable imitation or confusingly similar variation of any of Chane1's trademarks or trade dress on or in connection with any advertisement, promotion, offering for sale, sale, or distribution of Chane1-branded products that differ in any material way from genuine Chane1 products offered or sold through authorized channels in the U.S.;

(c) removing, altering, tampering or obscuring or otherwise defacing any information or material that appears on any Chane1 fragrance or packaging used in connection therewith, or advertising, promoting, offering for sale, selling or distributing any Chanel product in a form that does not include all information and material included in authorized and genuine Chane1 products;

(d) offering for sale, displaying, importing, selling any Chanel product that has been defaced, modified, altered or tampered with;

(e) processing, packaging, importing or transporting any Chanel-branded products that differ in any material way from genuine Chanel products offered or sold through authorized channels in the U.S.;

(F0738598.2 )

24

(f) using any false designation of origin or false description (including, without limitation, any letters or symbols), or performing any act, which can, or is likely to, lead members of the trade or public to believe that Defendants are associated with Chanel that Defendants are an authorized retailer of Chanel fragrances, or that any product imported, manufactured, distributed, advertised, displayed, promoted, offered for sale, or sold by Defendants is a genuine or authorized product of Chanel;

(g) transferring, consigning, selling, shipping, or otherwise moving any goods, packaging or other materials in Defendants' possession, custody or control bearing marks or trade dress confusingly similar to the Chanel Marks or the Chanel Trade Dress that are not genuine products or that differ in any manner from genuine Chanel products;

(h) using any false or misleading representations of fact, or performing any act, which can, or is likely to, lead members of the trade or public to hold false beliefs concerning the nature, qualities or characteristics of the Chane1-branded products advertised, promoted, offered for sale, sold or distributed by Defendants;

(i) engaging in any other activity constituting unfair competition with Chanel, or constituting an infringement of any of Chane1's trademarks or trade dress;

G) disposing, destroying, altering, moving, removing, concealing, tampering with, or in any manner secreting any business records (including computer records) of any kind including invoices, correspondence, books of account, receipts, or other documentation relating or referring in any manner to the manufacture, advertising, receiving, acquisition, importation, promotion, display, purchase, sale, offer for sale or distribution of any merchandise bearing marks or trade dress confusingly similar to the Chanel Marks and Chanel Trade Dress that is not a genuine Chanel product or that differs in any manner from genuine Chanel products;

[F0738598.2 }

25

(k) instructing, assisting, aiding, or abetting any other person or business entity in engaging in or performing any of the activities referred to in subparagraphs (a) through CD above or taking any action that contributes to any of the activities referred to in subparagraphs (a) through (j) above.

2) Directing that Defendants, at their own expense, immediately deliver up for destruction their entire inventory of goods bearing any of the Chanel Marks or Chanel Trade Dress that differ materially from authorized goods, and permitting Chanel to destroy such materials without compensation to Defendants.

3) Directing that Defendants make available to Chanel for review, inspection and

copying, all books, records (including all hard drives on computers used for business purposes, including servers, as well as all computer discs and backup discs) and other documents concerning all transactions relating to the importation, promotion, advertising, display, offering for sale, or sale of any product incorporating bearing any of the Chanel Marks or Chanel Trade Dress that differ materially from authorized goods, and provide Chanel the names, addresses and all other contact information in their possession, including telephone and fax numbers for (a) the source of such products including all manufacturers, distributors and/or suppliers, and (b) all persons or entities to whom Defendants have sold, distributed or supplied such products.

4) Directing such other relief as the Court may deem appropriate to prevent the

public from deriving the erroneous impression that any product manufactured, sold or otherwise circulated or promoted by Defendants within the United States is authorized by Chanel or related in any way to Chanel or that Defendants are otherwise affiliated with Chanel.

5) Directing that Defendants file with the Court and serve upon Chanel' s counsel

within thirty (30) days after entry of judgment a report in writing under oath, setting forth in detail the manner and form in which they have complied with the above.

6) Awarding Chanel monetary relief, including Defendants' profits, which amount

shall be trebled, from their sale of non-genuine Chanel Fragrances pursuant to 15 U.S.c. §117(a)(b); Chanel's actual damages trebled pursuant to 15 U.S.C. § 1117(a)(b); statutory

(F0738598.2 }

26

damages. if Chanel so elects and as the Court considers just, up to $2,000,000 per counterfeit

mark, which includes CHANEL, the CC Monogram, COCO, COCO MADEMOISELLE, CHANCE, ALLURE, ALLURE HOMME and the Chanel Registered Trade Dress, per type of goods sold, offered for sale, or distributed, as provided by 15 U.S.C. § 1117(b) & (c), for a total

of $18 million; and punitive and/or enhanced damages as provided for under applicable law.

7) Awarding to Plaintiff its costs and disbursements incurred in this action, including

reasonable attorneys' fees and expenses pursuant to 15 U.S.C. § 1117(a).

8) Awarding to Plaintiff interest, including pre-judgment interest on the foregoing

sums pursuant to 15 U.S.C. § 1117(a).

9) Awarding to Plaintiff such other and further relief as the Court may deem just and

proper.

Dated: New York, ~ew York February L, 2011

FROSS ~~~;CK LEH~~ISSU, P.C. // WJ~,/;;?/~

arbara A. S omon (bsolomon@fzlz.com)

Anna P. Leipsic (aleipsic@fzlz.com) 866 United Nations Plaza

New York, New York 10017

Tel: (212) 813-5900

Fax: (212) 813-5901 bsolomon@frosszelnick.com aleipsic@frosszelnick.com

Attorneys for Plaintiff Chanel, Inc.

(F0738598.2 )

27

EXHIBIT 1